The "Clerk Perks" Controversy

Texans for Public Justice and others have raised concerns about Justice Owen’s sensitivity to ethical issues in connection with the so-called “clerk perks” controversy that recently enveloped the Texas Supreme Court. At her confirmation hearing, Owen was questioned about this matter by Senator Feingold. Far from alleviating the concerns that had been raised, Owen’s answers to Senator Feingold –- which were erroneous in a number of respects -- raised yet additional concerns about her sensitivity to ethical issues.

The “clerk perks” controversy involved the Court’s longstanding practice of allowing the law clerks working for the Justices to be paid thousands of dollars in “bonuses” from their future private employers (including law firms with cases pending before the Court) prior to starting their private employment and while working for the Court. When this practice came to light in 2000, the Court’s rules did not prohibit judicial clerks from receiving “bonuses” from their future private employers while clerking for the Court. An article published in the Texas Lawyer on September 11, 2000 reporting on the “clerk perks” practice stated that the Travis County Attorney believed that it “pose[d] potential ethical and legal problems,” possibly including violations of the Texas Penal Code.10

The controversy did not end until earlier this year, when the Court adopted a new code of conduct for its law clerks prohibiting them from receiving special “bonuses” from law firms, as well as “from accepting any payment from a firm –- including reimbursement for Bar exam expenses -- until after they leave the court.”11 This action followed a refusal by the Texas legislature in 2001 to change the Penal Code to make the payment of law firm hiring bonuses for clerks legal,12 as well as an opinion issued in December 2001 by the Texas Ethics Commission stating that the Penal Code could be implicated if a law firm “paid a hiring bonus, in whole or in part, because of the court employee’s position or official status.”13

During the midst of the entire “clerk perks” controversy, Justice Owen was quoted in the press as saying, “It’s a political issue that is being dressed up as a good-government issue.”14 At Owen’s July 23 hearing, Senator Feingold, recognizing that the “clerk perks” practice had the “very real and serious” potential for a “conflict of interest,” quoted Justice Owen’s remarks back to her and specifically asked her, “Why do you believe that this was simply a political issue and not a genuine issue of ethics, fairness and independence of the judiciary?”15 In a disturbing response, Owen seemed to cast blame everywhere but at her Court, and even sought to attribute the same troubling practices that had been allowed by her Court to virtually the entire federal judiciary, including the United States Supreme Court:

[L]et me give some background, if I may, on the entire clerk issue. First of all, the -- there -- the investigation was not of my court or any judge on the court. That was an issue between the employers and the law clerks. The court or the justices were never under any kind of scrutiny at all from the criminal law standpoint. But this is a long-standing practice that I would say many if not most federal district courts, federal circuits, and I think even some judges on the U.S. Supreme Court –- law firms around the country typically give so-called “clerkship bonuses,” to their lawyers who take their first year of practice and clerk for a court, not just my court, as I said federal district courts, federal courts of appeals, U.S. Supreme Court, and nobody –- that was a practice that’s been around for a long time.16

Senator Feingold repeated his question: “Let me just return to my original question. Do you believe this is simply a political issue, or is it also a genuine issue of ethics, fairness, and independence of the judiciary?” Owen replied:

The reason I said it was a political issue is because it was only my court that was singled out, this practice –- they didn’t criticize the federal courts. They didn’t criticize any of the lower state courts of appeals who do it. They didn’t criticize the criminal court. And they didn’t criticize the U.S. Supreme Court. It was just my court that was singled out by a group who routinely issues press releases accusing my court of ethical violations.17

There are a number of very disturbing errors in Justice Owen’s response to Senator Feingold and in her efforts to explain away the remarks about which Senator Feingold asked her. First, Owen’s statement that the “clerk perks” practice “was an issue between the employers and the law clerks,” as though the Court itself had nothing to do with allowing the practice or no ability to set ethical rules for its own employees, is completely incorrect. In fact, the Court itself demonstrated that by adopting its new code of conduct prohibiting clerks from receiving payments from future employers while working for the Court.

Second, while trying to portray her Court as the victim of a private group, Owen’s response to Senator Feingold neglected the fact that the Travis County Attorney had repeatedly and publicly expressed his concerns about the legality of the “clerk perks” practice.18 Indeed, in September 2000, the Dallas Morning News reported that:

A local prosecutor has warned the Texas Supreme Court of possible legal and ethical violations with a longstanding practice of letting private firms pay hiring bonuses to court clerks who agree to join the firms after their clerkships expire. The problem, Travis County Attorney Ken Oden said, is that the bonuses . . . may constitute illegal gifts to the 18 briefing attorneys the court hires each year.19

Owen’s response also neglected the Texas Ethics Commission’s advisory opinion of December 2001, which recognized that the payment of bonuses to law clerks could violate state law.

Moreover, contrary to Owen’s assertion to Senator Feingold that her Court was the sole target of concern, the Travis County Attorney publicly stated that “the legal issue that’s been raised is valid not only for the [Texas] Supreme Court’s clerkship program but also for other state courts and a number of prosecutors’ offices and other agencies.”20

Finally, Justice Owen’s remarks concerning the practice of the federal judiciary raise very serious concerns. Owen’s apparent assertion that the federal courts permit clerk bonuses on the same basis as the former practice in the Texas Supreme Court, so that a federal judicial employee, while employed by the federal courts, could receive compensation from a future private employer, is flatly wrong. In fact, federal judicial clerks are, and at the time of Owen’s remarks about the “clerk perks” controversy were, prohibited from receiving “bonuses” under “longstanding rules that apply to federal law clerks, barring them from accepting bonuses during their clerkships.”21 The ethics manual for federal judicial law clerks published by the Federal Judicial Center, in a section entitled “Dealing with Prospective Employers,” plainly states that a clerk “should not accept a bonus while she is still employed as a law clerk.”22

The ethics manual specifically references Advisory Opinion No. 83 of the Judicial Conference Committee on Codes of Conduct, which expressly states that “[a] law clerk may not, during his or her service as a law clerk, accept any bonus given in anticipation of services to be provided for the clerk’s future employer.”23 Significantly, the Committee adopted this ethical proscription for federal law clerks even assuming that such clerks “will not participate in any judicial decisions that involve his or her future employer.”24 Justice Owen, however, in her answers to Senator Feingold, apparently considered such walling-off of a clerk to be sufficient, asserting it as the basis for her belief that the “clerk perks” practice at her Court did not constitute a “legitimate question of ethics and fairness.”25

In 1997, the Advisory Committee on Judicial Conduct of the District of Columbia Courts issued an opinion adopting restrictions on law clerk bonuses for clerks employed by the D.C. Court of Appeals and the D.C. Superior Court similar to those of the federal judiciary, prohibiting clerks from receiving bonuses “during the clerkship period.”26 That opinion underscored the reason for the federal judiciary’s policy: “These bonuses would appear to be a private-sector subsidy of a judicial employee intended to compensate for low clerkship salaries –- an arrangement that could suggest the subsidizer had some kind of relationship with the court, helping to pay the court’s way, that reflected an improper, if not unlawful, purchase of the justice system for private ends.”27

Comments such as these stand in sharp contrast to Justice Owen’s dismissive remarks in February 2001 about the “clerk perks” practice of her own Court, and her failure then or now to recognize the significant ethical concerns posed by such a practice. Justice Owen’s efforts at her confirmation hearing to explain those remarks when asked to do so by Senator Feingold are likewise quite troubling.